Details of the settlement weren't released, Reuters reported. The judge in the case last year rejected a Facebook request to dismiss the lawsuit and had scheduled a hearing on class-action certification for Thursday.

Facebook's sponsored-stories ads essentially display a user's name, picture, and a tagline asserting that the person "likes" a particular advertiser. These particular ads initially appeared only in Facebook's right column, but in January the social network moved them directly into users' news feeds, identifying them as "sponsored" stories.